Hong Kong: Inflation slows after the Lunar New Year holidays
April 22, 2013
In March, annual inflation moderated to 3.6% from the 4.4% tallied in the previous month, which had marked the highest level seen since April 2012 on the back of seasonal effects stemming from the Lunar New Year holidays. Moreover, the reading undershot market expectations of a 3.7%. According to the statistical institute, the monthly print was mainly influenced by lower inflation for food as well as for clothing and footwear. Building on the subdued monthly print, annual average inflation inched down from 3.8% in February to 3.7% in March.
A government spokesman stated that inflation is likely to remain contained in the near term, mainly due to weak economic performance at home and a more benign increase in import prices. That said, further down the road the statistical institute envisages upside risks to inflation, "including the progressive feed-through of the increases in private housing rentals over the past year or so".
FocusEconomics Consensus Forecast panellists expect inflation to average 3.9% in 2013, which is unchanged from last month's forecast. For 2014, the panel expects annual average inflation to moderate to 3.6%.